At James Monroe Middle School, located in a remote part of California’s High Desert, posters commemorating teacher appreciation week were hung beside porta-potties. They were the only toilets left for faculty members after the campus’s sewage system collapsed last year.
Sierra Sands Unified School District’s inability to afford to repair the sewage system — and the subsequent decision to close the school — are the result of crimes committed decades ago, forcing officials to make a host of cuts. Its superintendent is worried about the growing risk of insolvency.
This financial crisis goes beyond Sierra Sands and threatens public entities across the most populous US state. The growing strains are tied to a 2019 California law that removed the statute of limitations on sexual abuse lawsuits against public agencies, including school districts, unleashing a flood of litigation against governments, schools and other public agencies.
Last year, Sierra Sands, which serves around 5,000 students, settled one case stemming from abuse in 1989, and its annual insurance premiums have since risen 73% over the last 3 years — some $690,000 — a big hit for a small district. It is currently negotiating with another victim, and the superintendent, April Moore, said a large settlement on the pending case could raise concerns about a potential state conservatorship.
“Victims are due their justice, their due diligence and all their protections,” said Moore. “But I am tasked with protecting and serving our students of today, and they deserve everything we have and more. And when we’re taking our limited resources away from them and their future, then I see injustice at a very large scale.”
The 2019 law — known as AB 218 — was passed because many victims of horrific abuse had never been compensated for the long term harm they suffered. The law was a product of a growing awareness that the nature of sexual abuse leads many victims to block out their trauma until years later. In one case that emerged after the law was passed, a jury found that Moreno Valley Unified School District, south of Los Angeles, had hired a teacher and kept him on staff for two decades despite a long history of complaints that he had molested other students.
Now, though, offering some measure of justice for those crimes is creating a fiscal crisis that is rippling through local government agencies – and the clients they serve. Some government agencies are going to the bond market or taking out loans to pay for the settlements, though many are dipping into savings. The lucky ones have insurance coverage. But the dollar values involved are so large that the settlements are now imperiling the public insurance programs that schools and counties rely on to protect themselves against future unexpected costs.